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Grace be with you, mercy, and peace, from God the Father, and from the Lord Jesus Christ, the Son of the Father, in truth and love. (2 John 3)
What is the difference between the love, mercy, and grace of God? We read in Ephesians 2:4,5, “But God, who is rich in mercy, for his great love wherewith he loved us, even when we were dead in sins, hath quickened us together with Christ, (by grace ye are saved;).” This is such a wonderful scripture because it combines all three: Paul says that God is rich in mercy, and because of His great love for us, He saves us by grace.
What is the love of God? Well, God is love. Before anything was created, God was love. Love is the nature of God; it is what is called an attribute of God. But the interesting thing is that the love of God never saved a sinner. The love of God caused God to move in the direction of mercy and grace; it caused Him to exercise mercy and grace.
What is the difference between mercy and grace? Dr. Chafer very exactly expresses it: “Mercy…is that in God which duly provided for the need of sinful man.” God is rich in mercy. Why is He rich in mercy? Because He is love. And because God is love, He, by mercy, provided for the need of sinful man. But mercy didn’t save man. Again, I quote Dr. Chafer: “Grace is that in Him which acts freely to save because all the demands of holiness have been satisfied.” God today is free to act in grace. You are a sinner who cannot provide anything for God. You haven’t anything to offer to Him. But grace means that God can come to you, a lost sinner, and say, “I am love, and I am rich in mercy. I love you, and I have provided by My mercy a Savior for you.” Now if you will trust Him, “By grace are ye saved through faith; and that not of yourselves: it is the gift of God” (Ephesians 2:8).
There is a fine distinction here between these words. Salvation all stems from the love of God, but God does not save by His love or His mercy. After all, our God is holy, and the Bible says, “For God so loved the world, that he gave his only begotten Son…” (John 3:16). You see, God did not so love the world that He saved the world — He didn’t do that. God so loved the world that by His mercy He provided a Savior for the world, and He can now save by grace.
There is something else here that is important to see. Salvation is not only the expression of the love of God, but it is also an expression of His justice and righteousness. We not only need John 3:16, but we also need Romans 3:26: “To declare, I say, at this time his righteousness: that he might be just, and the justifier of him which believeth in Jesus.” In order to justify you when you trust Christ, God has to be righteous and holy and just. He cannot simply open the back door of heaven and slip you in under cover of darkness. You and I are not fit for heaven. We are alienated from Him. We have no fellowship with Him. Communication broke down in the Garden of Eden, and He is the one who renewed it. Because He must be just and righteous, His mercy provided a Savior, and it was because He loves you. He can be righteous and do this — “that he might be just, and the justifier of him which believeth in Jesus.”
Therefore, John can write, “Grace be with you [that is the way God saves you], mercy [mercy provided a Savior], and peace [when you have all this, then the peace of God that passeth all understanding is going to keep your heart].”
—From Edited Messages on 2 John by J. Vernon McGee

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3Sarah R = "This is important. When people say, "Why would a loving God send people to hell?" they are ignoring His holiness. God is love, but God is also holy and can have nothing to do with sin: "Your eyes are too pure to look on evil; you cannot tolerate wrongdoing" (Hab. 1:13). He also says that all of our "good deeds" are like "filthy rags" (Isaiah 64:6). We must acknowledge that our God is pure, Holy, Almighty, Righteous and Judge... and we would be lost if He had not Himself provided a way for us to be justified before Him."Therefore, since we have been justified through faith, we have peace with God through our Lord Jesus Christ." - Romans 5:1"